Once again, Bahrain is looking to extend its record for imposing one of the stricter anti-money laundering regimes in the MENA region, with a fresh round of proposed amendments to its AML Law that will have profound implications for its enforcement culture across regulated sectors.
Bahrain has pursued an effective business facilitation drive over recent years, which has seen it rise up the World Justice Project Ease of Doing Business Index 2021 to 2nd in the MENA region, adopting a stringent focus on ascending to international best practice standards. This focus on alignment with high business expectations is replicated in the authorities' financial crime enforcement approach, and particularly in the latest steps taken to reform domestic AML legislation. Bahrain's Parliament voted to approve Royal Decree No. 29 of 2020 amending certain provisions of Decree Law No 4 of 2001 (AML Law), bringing it one step closer to imposing the highest level of financial integrity protections recommended by international standards.
Whilst the amendments have not yet been effected, of particular relevance to Bahraini businesses is the new administrative penalty, which will see companies fined by up to 50,000 Bahraini dinars for failures to properly implement the required compliance measures prescribed by the law. Where there have been multiple failures, this fine can be multiplied by the number of violations, amounting to potentially astronomical fines for the most egregious laxities.
Bahrain has already seen a distinct step up in enforcement actions by its non-financial supervisors. For example the Real Estate Regulatory Authority in February this year applied punitive measures to several supervisee companies for non-compliance with RERA guidelines regarding the National Risk Assessment report and completion of a specified AML questionnaire. This latest amendment, however, once adopted into law, could provide especially strong incentive to regulated entities to ensure that their compliance programmes are up to scratch with the latest requirements of the authorities.
Other important updates contained in the Decree include a general prohibition to all natural and legal persons to implement targeted financial sanctions imposed by the United Nations Security Council, extension of corporate liability provisions for money laundering and terrorism financing offences, and broadening of key definitions to increase the scope of activity that could potentially fall within the remit of the AML law.
MPs approved a Royal decree to amend the 2001 Money Laundering and Terrorism Funding Law, aimed at tighter controls over money transfers and transactions.
https://www.zawya.com/mena/en/legal/story/Money_laundering_clamp_backed_in_Bahrain-SNG_207885048/
